Last Friday, the US stock market hit a new historical high, and Chinese concept financial stocks also performed well. Among them, securities firm Haichuan Securities rose more than 186% during the trading session, with a 96.92% increase as of the close; Huaying Holdings and Yiying Securities rose 14.64% and 13.04% respectively, Tiger Securities rose more than 7%, and Futu Holdings rose nearly 4%.
Recently, the market has been highly concerned about the prospect of interest rate cuts by the Federal Reserve. Data shows that the manufacturing industry in the United States further declined in February, and the weak consumer confidence index at the University of Michigan strengthened market expectations for interest rate cuts.
Haichuan Securities rose 96.92%
On March 1st, the stock price of Haichuan Securities, a Chinese concept securities firm, surged significantly, with the highest intraday increase of 186%. As of the close, it rose 96.92%, with a transaction volume of 208 million US dollars, closing at 2.56 US dollars per share, and a market value of 510 million US dollars (approximately RMB 3.67 billion).
From the historical stock price performance, the issue price of this stock was $4 per share. From June to July 2019, the company's stock price experienced a significant increase, with a historical peak of $19.55 per share. However, since then, the stock price has plummeted significantly, and since the end of 2021, the stock price has been below $1 per share for a long time.
Haichuan Securities is a Chinese company listed in the United States. According to the official website of Haichuan Securities, it was founded in Beijing on June 1, 2015 and submitted its registration and issuance documents to the US Securities Regulatory Commission on June 1, 2018. The company was listed on the NASDAQ main board market in January 2019.
It is reported that Haichuan Securities, formerly known as "Meimei Securities", acquired American securities firm Whitewood in 2016. Whitewood is an established American securities firm founded in 1937 and is a senior member of the Financial Industry Regulatory Authority (FINRA) and Securities Investor Protection Corporation (SIPC). The company's main business includes securities brokerage, placement and underwriting, as well as providing investment consulting.
In 2020, the company changed its Chinese brand name from Meimei Securities to Haichuan Securities. At the same time, the management of the company stated that while retaining its original business foundation, it will actively carry out overseas securities private equity fund custody, fund investment manager incubation, and main brokerage business. In addition, Haichuan Securities will also invest its core business in more diversified markets, while steadily developing its existing market, actively expanding its services to the North American and Hong Kong markets.
Financial data shows that as of June 30, 2023, Haichuan Securities had a revenue of 2.8564 million US dollars in the first half of 2023, a year-on-year increase of 289.48%; Net profit was $-14377400, a year-on-year decrease of 397.97%.
Multiple financial stocks surged
Since 2024, several Chinese financial stocks in the US stock market have performed well in terms of stock prices.
According to Wind data, since the beginning of the year, Huaying Holdings has increased by 319.06%, Haichuan Securities and Senmiao Technology have increased by 156% and 148% respectively, AKSO HEALTH (Aso Health Group, consumer credit company) and Yiren Jinke have increased by 87.83% and 76.92% respectively. In addition, Yiying Securities, Shuidi Company, Puyi Wealth, and Jiayin Technology all saw gains of over 20%. It is worth noting that as of the latest closing date (March 1st), the market value of the above-mentioned companies is either less than or has just exceeded $500 million.
In addition, since February, Lujinsuo Holdings, Futu Holdings, and Tiger Securities have also shown significant gains, with gains of 35.87%, 18.94%, and 15.82% as of last Friday's latest closing.
Based on the performance of Futu Holdings, which has the highest market value among them, the company's stock price has experienced nearly three years of volatility and decline since reaching a historical peak of $204.25 per share in February 2021. The lowest drop in stock price is $34.57 per share, with a correction rate of over 80%. As of the latest closing date, Futu Holdings closed at $55.57 per share, with a total market value of $8.2 billion (approximately RMB 59 billion).
Recently, Bank of Communications International released a research report analyzing the impact of the Federal Reserve's expected interest rate cut on Futu Holdings' revenue. The report stated that it is expected that the Federal Reserve's interest rate cut in 2024 will have limited impact on the company's revenue, and the market is overly pessimistic about this expectation. 1. The speed and magnitude of the Federal Reserve's interest rate cuts are likely to be lower than the current market expectations; 2. If the Federal Reserve starts to cut interest rates in the second half of the year, referring to the income performance of Yingtou Securities in the previous round of interest rate cuts, there is a lag in the response of net interest income changes to interest rate cuts, and the impact on 2024 income is limited; 3. If the interest rate cut leads to a rebound in market valuation and active transactions, the growth of trading and financing income is expected to fully compensate for the decrease in net interest income.
The Federal Reserve's semi annual monetary policy report shows that inflation in the United States has significantly slowed down, but still remains high; Inflation expectations generally meet the 2% target; The labor market remains relatively tight; The demand has slowed down and the supply trend has increased; The risks of achieving goals are becoming more balanced; The Federal Reserve remains highly concerned about inflation risk; The continuous weakening of labor demand and the improvement of labor supply should help further alleviate the inflation of core service prices; Interest rate hikes, stricter loan approvals, regional planning, and other regulations have restricted housing supply.